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Wal-Mart goes to school: the Walton empire gets political.

Wal-Mart is frequently in the news as America's most controversial retailer and largest private employer, with 1.2 million U.S. workers. But behind Wal-Mart is a quiet family that is just beginning to flex the full muscle of their wealth and power. And in the coming years, they will give efforts to privatize public education an enormous boost.

They are the Walton family, including Helen, the 86-year-old widow of the late Wal-Mart founder Sam Walton, and their four adult children, Alice, Sam, Jim, and the late John. John Walton died in a plane crash in June 2005, leaving his share of family wealth to his wife, Christy Walton.

The Walton family is a formidable concentration of private power and wealth, which they exercise through political contributions, charitable donations, and in the marketplace through their ownership stake in Wal-Mart and other ventures. Together they are worth more than $90 billion, exceeding the combined net worth of Microsoft founders Bill Gates and Paul Allen. The Waltons own 39 percent of Wal-Mart. Their estimated dividend income is $880 million a year, or $175 million for each of the Walton heirs. And this wealth and income will only grow as Wal-Mart aggressively expands in the U.S. and overseas.

To deliver on its "We Sell for Less" pledge, Wal-Mart leverages its tremendous market power to squeeze its suppliers to produce for less. This forces producers to seek the lowest possible environmental and labor costs and often to shift production to sweatshops in China and other countries where workers have little power. With their controlling interest, the Walton family could be a moral force for good, urging the company to end such practices and raise wage and benefit standards for their own employees. Instead, they remain silent.

The 2004 election campaign cycle revealed that Mice Walton has begun to champion conservative candidates and causes. She was in the top 20 biggest contributors to right-wing "527" lobbying corporations. Her largest donation of $2.6 million went to Progress for America, which sponsored the Swift Boat Veterans for Truth attack on candidate John Kerry and lobbied for the privatization of social security and repeal of the estate tax.

The Waltons' most significant legacy, however, may come from the family's charitable giving and the hundreds of millions of dollars channeled since 1998 toward conservative school privatization efforts. As Jim Hopkins observed in USA Today, the Waltons "have begun focusing more giving on private-school scholarships, charter schools, and vouchers--revealing clues as to how they'll target giving as their family charitable foundations grow." Walton funds support projects that weaken public schools and shift public resources to private schools, undermining a cornerstone of equality of opportunity and democracy in the U.S.

This focus reflects the outlook and activism of the late son John Walton, who was a school privatization zealot. While alive, he steered the foundation's giving in this area--and complemented it with political contributions. There is every reason to believe the foundation will continue this focus in the wake of his death.

In the coming decades, the Walton Family Foundation will become the largest private foundation in the world, surpassing the Bill & Melinda Gates Foundation. Helen Walton has declared her intention to bequeath the majority of her estimated fortune of $15 billion to the foundation--and several of her children will likely follow suit. The Waltons' potential to fund anti-democratic school privatization efforts could grow to a whopping $1 billion a year, raising fundamental questions about the political power of private charities.

The whole picture is alarming. Wal-Mart fails to pay its workers a living wage, extracts profits from underpaid producers, and destroys Main Street businesses. At the same time, the Walton dynasty takes their sizeable profits and through campaign contributions and charitable donations influences public policy and undercuts public education.

The problem is not just the amount of money flowing toward one family's narrow pet political agenda. Whether it is George Soros funding liberal causes or the Waltons putting a mighty thumb on the scale of educational policy and politics, there is something fundamentally anti-democratic about so few people having such inordinate power in shaping the culture and rules of our society.

Our society needs to remain vigilant to strengthen democratic institutions such as public education. We need to defend the estate tax, which is targeted for elimination, and limit concentrations of wealth. And we should require greater oversight of the largely unaccountable private charitable sector whose entire existence is subsidized by U.S. taxpayers. Otherwise, our politics and culture will become even more dominated by dynasties of private wealth and power--just as every Main Street business is now threatened by the next Wal-Mart.

Chuck Collins and Felice Yeskel are co-authors of Economic Apartheid in America (October 2005, New Press). Yeskel is co-director and Collins is senior fellow at Class Action (
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Title Annotation:Wal-Mart Stores Inc.
Author:Yeskel, Felice
Geographic Code:1USA
Date:Apr 1, 2006
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